Pontifax AgTech, Provivi & The Bouqs Highlighted as Elements of LA AgTech Innovation Hub
The digital agricultural revolution can be directly traced to Los Angeles. This historical but also growing bond with agriculture, technology, and food uniquely positions it to be a leader in the industry’s transformations, writes Liron Brish, CEO of FarmDog, the field scouting software.
Los Angeles, renowned for Hollywood and palm trees, was associated with something different just 75 years ago – agriculture. From 1909 to 1949, Los Angeles County ranked as the nation’s top farm county. What is now covered by highways, was home to over 13,000 farms growing a colorful mix of fruits, vegetables, cotton, and hemp, and raising livestock.
However, as the population boomed from 200,000 in 1900 to 4,500,000 in 1950, agriculture was uprooted. By 1955, the transformation was nearly complete as Disneyland materialized atop 160 acres that a couple years earlier were home to lush citrus orchards. While some production remains in Los Angeles County, the 2017 Census of the US Department of Agriculture ranked it only 737 in the nation. Reminders of Los Angeles’ paved-over potential flourish in neighboring Fresno, Tulare, Kern, Ventura, and Santa Barbara Counties, ranked between 1 and 16, and producing more than $13 billion worth of crops just a short drive away.
Given the area’s legacy and geographic position, a supporting ecosystem developed. After harvest, crops are processed for consumption as food, clothing, fuel, and other forms. More than $11 billion in value-added processing occurs in Los Angeles, ranking first in California, thanks to the more than 100,000 people working in food and beverage processing, one of the nation’s top 5 workforces for food manufacturing. Brand-name processors here include Beyond Meat and Don Lee Farms, the maker of plant-based and meat proteins for over 8,000 clients including Costco.
After processing, sales occur in wholesale and retail markets. The country’s largest wholesale produce market, the Los Angeles Wholesale Produce Market, hums with activity, six days a week. Trader Joe’s, named the most preferred grocery store destination, manages $13 billion in revenue and 500 locations from its Los Angeles headquarters as does Thrive Market, with hundreds of thousands of subscribers to its online “Whole Foods meets Costco.”
The sister ports of Los Angeles and Long Beach distribute these goods from the second busiest agricultural port complex, moving 16 million metric tons of agricultural output in 2017. And Western Growers Association influences regulatory policy for the benefit of 2,400 members that grow over half of the nation’s fruits, vegetables, and nuts, from its headquarters here.
An example of the area’s full value chain strength is found at The Wonderful Company, the vertically-integrated owner of POM Juice, Wonderful Pistachios, a flower delivery company, an agricultural pest control company, land and water holdings, and a shipping company, among others. The organization manages its $4.6 billion portfolio of production, harvesting, bottling, packaging, and marketing from Los Angeles.
Alongside these agricultural institutions, Los Angeles has emerged as a leading technology hub. Dubbed “Silicon Beach,” it is home to leading technology companies like Snap, SpaceX, and Tinder, local startups raised $6 billion in 2018, and a strong pipeline of elite talent fuels the ecosystem.
As technology pulls the city forward into the digital future, it has also contemporized its association with agriculture. This started 20 years ago with an unexpected cross-over between the two industries and continues today with AgTech startups.
In the 1980s, the agriculture industry envisioned a future utilizing precision agriculture to improve management practices – a digitized world in which each part of a field was identified as a distinct parcel of land with varied crop yields and input requirements. Insights generated by a digital stream of field data would lead to optimized yields and reduced inputs. John Deere, the world’s largest farm equipment manufacturer, envisioned that its fabled green tractors, melded with precise GPS software, would lead this change. Early developments came short of expectations, however, as John Deere’s GPS performance failed to meet precision requirements.
But a young Los Angeles company did have this technology. NavCom, founded in 1992, became a leader in GPS solutions shortly after its founding. The two companies began collaborating, and this odd couple — a stalwart Heartland company and a young West Coast company — proved so successful that it led to John Deere acquiring NavCom in 1999 with development continuing in-house.
While precision of an inch was achieved, reliability lacked, as GPS would be lost in real-world scenarios such as driving the tractor next to a hill. So in 2004, John Deere turned to yet another Los Angeles-based entity, the NASA Jet Propulsion Laboratory, to improve reliability by leveraging NASA’s network of GPS ground stations.
This collaboration was also successful, driving an increase between 2005 and 2019 of the percentage of agricultural retailers offering GPS autosteer guidance from 5% to 90%. Farmers utilizing yield maps, variable rate applications, and autonomous tractors, unknowingly use Los Angeles technology each day in their fields.
John Deere’s Los Angeles activities began a new technological twist in the area’s agricultural legacy. Since then, digitization in agriculture has come to mean more than just GPS-enabled tractors, and a quietly but quickly growing ecosystem for AgTech startups carries the story forward.
The ecosystem includes:
Aerobotics, an aerial data analytics company for early stage problem detection and yield management used on 40 million trees
Bouq’s, a leading e-commerce flower seller working globally with farmers to provide sustainable, cut-to-order bouquets
Farm Dog, an end-to-end pest and disease management platform used on over 1.5 million acres conducting co-R&D with John Deere through a $900K grant
PickTrace, a workforce and harvest management software providing solutions to farms across the US, Latin America, and Australia
Plenty, an indoor agriculture company that has raised $260 million and recently announced that its second facility will be in Los Angeles
Pontifax AgTech, a growth equity venture capital firm that has raised a total of $245 million across two funds
Produce Pay, a financial technology solution that provides fresh produce farmers with financial resources and has helped finance around $1 billion of produce in 5 years
Provivi, a developer of pheromones for pest control and recently raised $85 million
UAV-IQ, a drone operator has partnered with Koppert Biologic Systems to deliver more than 10 million beneficial insects via drone to growers
These companies all play a role in the digitization of agriculture, a challenging feat, according to a McKinsey & Co. study identifying agriculture as the least digitized of all major industries. To date their success can be attributed to strong teams, but their full potential lies not only internally, but to the ecosystem in which they belong.
Just as Los Angeles provided John Deere an opportunity for cross-industry collaboration, so, too, does it provide these companies a synergetic environment. True revolution will not come from siloed solutions, with each company entrenched within itself, but through collaboration among the value chain. Los Angeles’ advantage over other ecosystems lies in the close proximity of varied stakeholders.
If this strong mix of startups, established agricultural companies, and leading players from the value chain can replicate the deep history here of cross-industry collaboration, expect that Los Angeles will be ubiquitous the world-over for its agricultural leadership. Here’s hoping for a Hollywood ending for all.
For original article click here.